Team appointed to select IBRA bad debtors

Team appointed to select IBRA bad debtors

The Jakarta Post, Jakarta

The government said it has appointed a team of legal experts
to filter out uncooperative debtors from the Indonesian Bank
Restructuring Agency (IBRA), paving the way for legal action
against them.

Called the legal counsel, the team would work for a month to
identify the bad debtors, Secretary of the Financial Sector
Policy Committee (FSPC) Syafruddin Temenggung said on Monday.

"It will be a snapshot of debtors' compliance with their debt
settlement deals," he told reporters, anticipating that the
counsel will wrap up its work by April 18.

The legal counsel is part of a new approach against the
debtors, after an earlier plan to grant them a longer payment
period was scrapped following intense public criticism.

At stake is some US$10 billion, mostly in misused liquidity
loans, which former bank owners agreed to repay IBRA in return
for not facing criminal charges.

For many, the deadline by which to settle their debts expires
this year.

Syafruddin said that the legal counsel consisted of two teams,
with one being in charge of identifying the bad debtors.

That team would be the legal assistance team which has, among
its six members, lawyer Todung Mulya Lubis, and IBRA's head of
litigation division, Robertus Bilitea.

The second team, called the legal assistance direction team,
will consult the government, and evaluate the first team's work.

Members of this team include lawyers Kartini Mulyadi, Luhut
Pangaribuan, and officials from the police force, and the General
Attorney's Office.

Head of the second team, FSPC vice secretary, Hadiah Herawati,
said that only reputable lawyers with no connection to IBRA's
debtors could sit in the legal counsel.

"We asked them (the lawyers) whether they had represented (a
debtor) in a case against IBRA," she said, adding that they
cross-checked the information with IBRA's database.

Syafruddin added that, once the FSPC approved the teams' work
and debtors received the results, the uncooperative ones would be
given three months to settle any shortfall in their agreements.

"They don't need to settle their entire debts within the three
months, only the amount they had neglected to pay," he said.

But the bulk of the debts are being repaid under a scheme that
does not have a payment schedule other than its four-year
deadline.

Falling under the Master of Settlement and Acquisition
Agreement (MSAA) are some $5.6 billion in debts on which payments
have virtually stopped.

Owned by five of the country's largest conglomerates, the
debts are to be repaid through asset transfers.

But the MSAA leaves it up to the debtors when they want to
start their payments, which may block the legal counsel from
claiming those who have not begun payment as violating the MSAAs.

Elsewhere, legislators urged the government to immediately ban
the large uncooperative debtors from travel overseas, while their
debt settlement accords were being reviewed.

"Waiting for the conclusion of the legal counsel might be too
late, as the bad debtors may have fled overseas by the time they
are required for questioning," House Vice Speaker for economic
affairs Tosari Widjaya said in a statement.